# Fears of a recession ring true as data shows signs of labour market struggles
Published: 2022-07-20
Category: News
Category URL: https://palmbayherald.com/category/news/
Meta Title: UK Labour Market Concerns: Recession Looming Ahead?
Meta Description: Latest data from APSCo shows slowdown in hiring, increase in skills shortages, and cost-of-living crisis impacting the UK's economy.
URL: https://palmbayherald.com/fears-of-a-recession-ring-true-as-data-shows-signs-of-labour-market-struggles/

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## Fears of a recession ring true as data shows signs of labour market struggles

Concerns that a recession is on the cards look set to come to fruition – perhaps earlier than expected – with the latest data from the Association of Professional Staffing Companies (APSCo) revealing difficulties in the UK’s labour [market.](https://palmbayherald.com/gum-content-tester-market-2021-scope-of-current-and-future-industry-2029/)

While reports from the Office for National Statistics (ONS) showed small signs of economic growth in May following [months](https://palmbayherald.com/recruitment-slowed-in-december-but-pre-pandemic-comparisons-suggest-hiring-still-booming/) of retraction, APSCo’s June research suggests that the economy is feeling the effects of Government uncertainty, a cost-of-living crisis and substantial skills shortages.

Overall, the data – provided by the global leader in software for the staffing industry, Bullhorn – shows a slowdown in hiring between May and June. With May a quieter [month](https://palmbayherald.com/recruitment-slowed-in-december-but-pre-pandemic-comparisons-suggest-hiring-still-booming/) for hiring activity due to the bank holidays, a drop from May to June suggests hiring is on a downward trajectory in the lead up to the summer months – bucking the usual trend of June recruitment spikes ahead of seasonal drops in July / August.

The number of permanent jobs added dropped -12% [month-on-month](https://palmbayherald.com/recruitment-slowed-in-december-but-pre-pandemic-comparisons-suggest-hiring-still-booming/) in June, while contract positions fell -11%. Year-on-year comparisons show that permanent roles are on a downhill trajectory, down -2% between June 2021 and June 2022, though contract roles increased 5% in this period.

Pre-pandemic comparison paints worrying picture

While the hiring [market](https://palmbayherald.com/gum-content-tester-market-2021-scope-of-current-and-future-industry-2029/) is clearly beginning to slow, pre-pandemic comparisons paint a worrying picture for permanent positions, with the number of permanent jobs being created dropping 9% between June 2019 and June 2022. This suggests that the stability of the country’s hiring [market](https://palmbayherald.com/gum-content-tester-market-2021-scope-of-current-and-future-industry-2029/) – and subsequently, the economy – is beginning to waiver.

Placements also dropped month-on-month for both contract and permanent roles, down -9% and -7% respectively. Although permanent salaries reported a 2% increase month-on-month, the annual -3% decline at a time when the UK is facing a cost-of-living crisis and rising energy costs is a concern.

Ann Swain, CEO of APSCo comments:

“A slow-down in hiring following the post-pandemic boom was to be expected, but in the current market and with talks of a potential recession in the pipeline, this decline is of concern. The UK’s post-Covid economy has been hit with employment strikes, skills shortages, Government uncertainty and a cost-of-living crisis. With controversial changes to rules around using agency workers during strikes voted in and the country facing continued uncertainty alongside Governmental leadership changes, employers and the [recruitment](https://palmbayherald.com/apsco-deutschland-appoints-new-managing-director/) sector have been hit hard. Stability is crucial as we continue to navigate such an ambiguous market. As the trade body for the professional [recruitment](https://palmbayherald.com/apsco-deutschland-appoints-new-managing-director/) sector, we believe that there is more to be done to make the UK’s employment sector competitive on a global scale. With recruitment activity slowing, we could be at a tipping point that sets the country on a downward trajectory unless swift action is taken.”


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